Should I Extend My Lease Now or Wait for Leasehold Reform Implementation? 2026 Update

If you own a leasehold flat and have been waiting for the promised leasehold reforms before extending your lease, you are not alone. Thousands of leaseholders across England and Wales face the same dilemma, watching their lease shorten while Parliament finalises the details. The question of whether to extend now or wait depends on your personal circumstances.

Following the King’s Speech on 13 May 2026, which confirmed the new Commonhold and Leasehold Reform Bill, the timetable has shifted, making waiting less advantageous for many leaseholders. This article explains the current legal position, outlines what the reforms mean for different groups, and explores scenarios where waiting may make sense versus those where it could be costly. It applies to England and Wales and does not cover leasehold houses in Scotland, which have a separate legal framework.

Where Leasehold Reform Actually Stands in June 2026

Most leaseholders know that the Leasehold and Freehold Reform Act 2024 became law in May 2024, but very little of it is actually in force. So far, the only changes are that you no longer have to wait two years after buying a property to start a lease extension, and more leaseholders in mixed-use buildings can exercise the Right to Manage without paying the freeholder’s legal costs. Everything else, including the end of marriage value, 990-year extension terms, standardised valuation rates, and limits on freeholders’ fees, is still on hold.

What the Reforms Will Change & for Whom?

The reforms do not help everyone equally. Some leaseholders will save significantly. Others may end up paying more once the new rules arrive.

Abolition of Marriage Value: Big Change for Short Leases

Once the relevant provisions of the 2024 Act take effect, marriage value will no longer be payable. The same extension could cost between a third and two-thirds of today’s price, representing a significant saving for many leaseholders. However, the final cost will depend on how the government sets the new valuation rates, which have not yet been decided.

The Deferment Rate: How It Can Affect Your Lease Extension

When you extend a lease, the freeholder gives up the right to regain the flat in the future. The deferment rate is used to calculate how much the future interest is worth in today’s money. A higher rate generally means the freeholder’s interest is assumed to grow faster, so the upfront cost is lower. A lower rate assumes slower growth, which can increase the amount payable upfront.

Ground Rent Cap: Helpful, but Only in Specific Cases

The 2024 Act plans to cap ground rent for lease extensions at 0.1% of the property’s value. This can save money for leaseholders who currently pay high ground rents.

For example, if a flat is worth £300,000, the cap would be £300 per year. If your ground rent is already below that, say £50, £100, or £250 a year, the cap does not reduce your rent further — it only limits very high ground rents. The overall effect could also be affected by the rate used to calculate the ground rent’s value in the lease extension premium, so the net benefit may be small or neutral.

990-Year Extensions: Worth Less Than They Sound

Under the Leasehold and Freehold Reform Act 2024, the standard lease extension term increases to 990 years for flats and houses, replacing the old regime where flats typically got only 90 extra years under the Leasehold Reform, Housing and Urban Development Act 1993.

In practical financial terms, extending an already long lease by hundreds of additional years adds very little to the actual cost because the value the freeholder gives up (called the reversion value) becomes negligible as the term lengthens. Most of the benefit of a lease extension comes from slowing or stopping future loss in value as the lease shortens, rather than from the sheer number of extra years added.

Should You Extend Now or Wait? A Practical Guide by Situation

Imagine a flat in London with just over 80 years remaining on the lease and a modest ground rent.

• If you extend now, the cost is generally lower because the marriage value does not apply. You would pay the lease extension premium, professional fees, and legal costs.
• If you wait until the lease drops below 80 years and the reforms are not yet in force, the marriage value would apply. This could make the extension significantly more expensive than acting now.
• If you wait and the reforms come into effect before the lease drops below 80 years, the premium may be lower under the new rules, but professional fees would still apply, and there is no guarantee that key rates, such as the deferment rate, will remain the same.

The actual cost depends on your specific lease, the property’s market value, ground rent, and the valuation rules in force at the time you make your claim. Consulting a specialist surveyor and solicitor is recommended before deciding.

A Quick Decision Checklist

Use this checklist to understand your situation before speaking to a professional:

Frequently Asked Questions

Conclusion: Get the Numbers Before You Decide

Deciding whether to extend your lease now or wait is highly personal, and general guidance only goes so far. The financial difference between acting at the right time and waiting too long can run into thousands of pounds, and the best choice depends on whether your lease is 79 years, 85 years, or 105 years.

The reforms will eventually come, but there is no confirmed date, and waiting has often cost leaseholders more rather than less. The 80-year threshold remains important, the deferment rate is uncertain, and your lease shortens every year. If your lease is approaching 80 years or matches any of the scenarios discussed here, the most useful step is to get a detailed cost comparison from a qualified leasehold specialist before the numbers move further against you.